Many private companies see an initial public offering as a means to grow their business. This is a complex process, carries significant risks and requires a strategic approach and meticulous planning to ensure long-term success.

The first step to prepare for an IPO is to develop and communicate your equity story that explains to investors the path you are taking towards value creation and sets apart your company from competitors. This is crucial for establishing an attractive valuation and attracting the interest of investment bankers, analysts and underwriters.

The https://designdataroom.com/venue-by-dfin-vdr-review/ next step is to assess your management team and leadership. You must ensure that your management team is able of handling an IPO that is a high-risk venture. For example an IPO can bring on additional financial reporting requirements and tax implications. This could require the addition of an expert in tax or finance to the executive team. It is also necessary to decide if you want to use dual-class stock, which grants the founders and the top managers different voting rights.

A strong track record of financial accountability and control is crucial for an IPO. This means having a clearly defined SOX program, which should be in place and regularly updated before the IPO. It is also crucial to review your current system of records. This includes capitalizations files, minutes material agreements, the old option grants. This is essential to meet SEC requirements and bank underwriters. It is crucial to determine whether there are any “material weaknesses” in the company’s controls to fix them prior to going public.